What is the expected cost to the company

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Reference no: EM132404100

1. In a population, 95% of adults weigh between 50-80kg. Assuming a standard normal distribution, show your calculations and show on a standard normal distribution diagram:

(a) The mean

(b) The adult weights that correspond to the following z-scores:

-3.5, -2.5, -1, +0.5, 2, 3.

2. A manufacturing company produces tires at a cost of $65 each. The following are probabilities of defective tires in a given production run: probability of no defective tires 8%; probability of 1% defective tires 32%; probability of 2% defective tires 35%; probability of 3% defective tires 25%. When a defective tire is detected, it must be removed from the assembly line. The tire is discarded, and replaced by another tire. This process adds an extra $6 to the cost to install the replacement tire. 

a) What is the expected cost to the company of a batch of 4,000 tires? Show your calculations.

b) What would be the cost to the company to produce the same batch of 4,000 tires if there were no defects?

Reference no: EM132404100

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